tv Closing Bell CNBC July 12, 2016 3:00pm-5:01pm EDT
>> up a bit today. >> what did you get me for prime day? >> we haves materials and energy the gainers. thanks good to have you with us, michelle. >> "closing bell" starts right now. >> happy prime day. hi, everybody. welcome to "closing bell." aisle kelly evans at the new york stock exchange. >> welcome back. i'm bill griffeth. the dow on track for its highest close of all time. we're going to talk about whether there are still buys opportunities at these levels. >> and we've gotten steven roach joining us to discuss that and whether it could be a red flag, plus roger altman on whether the uk vote could pose risks down the road. >> let's get to the market at all-time highs. let's get to the closing
exchange. paul dietrich is with us today. he's at post 9, along with steven sarge gill four, and rick santelli is stick looking for buyers of ten-years notes. sarge, here we are, all-time highs for the dow and s&p, some other averages not the case. what's your assessment of this? they buy treasuries, they buy stocks. for several days, they buy stocks. in you think the market is going to come in, you don't.
people are talking about buying bonds for the capital gains. what are you advising people when it comes to -- maybe they still have hesitations? >> you know, you're looking at the ten-year yield at practically nothing, and what we're seeing is moving into the stock market. i'm recommending even with the stock market at historic highs, there are still a lot of bargains in this market. i mean, if you're a value investor, as we are at fairfax global markets, where we look for low pes, high returns on equity, there are still a lot of bargains in this market. >> like what? >> apple, for example, is selling at a ridiculously prized ten times earnings, has a 40% return on equity, massive free cash flow, and what people don't understand is that apple, unlike google and facebook that sells
services and sell advertising, they sell equipment, and they go in cycles. the reason why the apple price is so low these days is because of the china. well, you have to understand that buying cycle in china, because in to 12 and to 13 when they first put the iphone into china, everyone bought it. most people keep them for three our foryears. we're coming into the cycle in the next year. goldman sakes said they think in the next six to nine months, more than a 60% increase over what it's selling for today, that's a heck of a good return form yell it didn't go well. ten-year auction didn't go well. have we finally discovered there
are buyers that won't go to a certain level, a certainly yield below where we were? have we hit a bottom, do you think? >> i think they're debating a better entry point. sevens are considered a lucky number in las vegas, but when you haven't had bid to covers, meaning amount of investor dollars chasing amount of dollars available at auction, when you haven't seen those poor metrics in seven years for the three-year or seven years for today's ten-year, that's not a good thing. when you kerr we're at 136 closing yield. when we were hovering around a 150 yield, paul said, you know, that's next to nothing, i agree with him until you put it next to a bund or -- now it's a bit more something, but i think that investors aren't tiring of the knowing that they know they can game -- or the quantitative
easing, that doesn't help. i think they're debate iing. make looking at that yen, more stimulus measures from the bank? is that a big factor behind u.s. stocks? >> the story with japan is you probably have a fiscal and stimulus package fused together over there. doujt the road don't be surprised if the boj forgives the dead. that's how they're going to -- s. europe is on deck, great
britain is on deck, you know, and the federal reserve can't be too far behind. how about those indirect. you should understand that -- i don't think sarge is advocating that at all. >> i get what sarge is doing. com padres, of insanity in central banking? >> you're on the same side of that trillion dollar coin, for sure. some of the beaten-up stocks there yet? >> yes, there are a whole group of stocks with low pes, with huge cash flow, and i think now because of brexit, where there's
a lot of people are concerned about the markets. i think now is a real buying time for a lot of beaten-down, blue chip stocks in europe. because a lot of different play places you can't look, but banks for example, would they make your list there? >> you know, the thing about brexit is it's going to have a lot of political consequences, but in the end it's going to have zero economic consequences, at least in the short term, because for the next two years-plus, britain's going to be in the european union. nothing's going to change and they're going to have a lot of time to renegotiate their trade agreements, and because the markets have been hit with in now is the time to buy. including financials. >> good to see you all.
>> >> let's move on to amazon, falling into the session, as the company is holding its second prime day, offering exclusive deals for prime customers. it's kind of like christmas in july. >> kind of, except you're buying stuff for yourself this time around. let's bring in ross gerber, and ross, you're -- are you a customer? buying stuff today? >> i'm a customer every day at my household, yes, i'm sure my wife is shopping away, as we speak. i was disappointed on what we saw actually for sale -- i will keep looking. what i was told from about 60 to 80% of my office they have made purchase already. >> the stock is down maybe on the sales that aren't going to hit the mark. >> i'm sure they'll hit a huge
number. >> james, what about you? you have some caution at these levels, right? >> sure, a little bit, but at the end of the day when you look at what they're accomplishing with prime, you know, i think it's pretty impressive, and i think some of the headlines, you know, with the initials sales being negative. at the end of the day what they're trying to do is move to the membership model, and the fact they're able to convert prime day at the rates of black friday and cybermonday, so they are very solid conversion rates. that's why you're seeing the acceleration of growth, 26, 27% and possibly higher in q2 while showcasing their private label. so maybe on this say, poke mon go hit some of the sales today, but -- >> are you suggesting that people are hunting for poke mon instead of show pg on prime day. is that possible? >> i tried it this morning. look, that was a joke, but -- s
they're doing both. you. >> well, this is a tough stock, because it trades at the premium multiple, but where does amazon go. it seems only up. if you look at a price to seals ratio, it's actually not as expensive as a price-to-earnings ratio. it's not that concerned about earning money, but what they are good at is growing revenue, and i think they'll be successful to --, let's be rule. >> how big could they get in your view? that's what it's going to come down to. when people look at whether it will move, it's also about how much bigger could amazon get? >> the reason we're neutral is more macro-driven. at the end of the day, just
because they're -- they're also essentially becoming a tax on vendors, having to use amazon as a distribution channel. sets interestingly brands are looking at amazon as more of a friend than a foe because of the fact that they were getting squeezed by the big-box retailers for a number of decades for shelf space. so amazon, you know, does have a long runway, but right now the neutral rating is a function macro. >> amazon could bring in $525 million, maybe that's a bit of a reach. even if it doesn't reach that number, do you fear that they could be frond-loading sales, drawing them up to this level and the next few months they may suffer, because people bought on prime day instead? >> i don't think so. i think prime day is all about
getting people to sign up for prime. look at it this way, they sell everything at cost and hope to make money on the $100 on prime and give you all this video stuff on top of it. so they're making about $30 of that $100 that's free money to them or less. so the profit margin is about 0.5%, the lowest of any retailer. what they really want is everybody paying $100 a year on prime. if they can get that number from 30 or 40 milton to 60 or 80 million of households, they'll be in great shape long term. >> fascinating. just looking around myself, their prices are not the lowest relative to where you could get them, but a lot of people are stuck in the system, because they feel like the free shipping is a bargain. >> yeah, you have to do it. >> exactly. exactly. guys, thank you. >> good to see you. >> see you later, ross. >> on amazon prime day, july 12th.
not quite bass steel day. about 45 minutes to go here, dow is up 122 points today. we closed yesterday for the s&p at new record highs. we're well above the intraday highs. the dow is at 18350, so that puts it -- we're there. >> closing high 18,312. in fact the intraday was 18,351, we're about a point or two away from the levels. the nasdaq is currently in the green, year to date, but it's currently at 5,000. >> much more ahead on the markets run into this record territory. executive chairman roger altman will tell us how long he thinks stock can keep up the pace, that's coming up here. >> trouble in the south china sea. china vowing to ignore an international tribunal rejection of claims over disputed territory, and it says its armed forces would defend its
interesting. a leading china expert weighs in on how this high-stakes also situation could play out. you're watching cnbc, firstn business worldwide. ♪ in new york state, we believe tomorrow starts today. all across the state, the economy is growing, with creative new business incentives, and the lowest taxes in decades, attracting the talent and companies of tomorrow. like in buffalo, where the largest solar gigafactory in the western hemisphere will soon energize the world. and in syracuse, where imagination is in production. let us help grow your company's tomorrow - today - at business.ny.gov a good car has to maneuver quickly.
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welcome back again, significant days ago in mark with the dow touching its intraday high. it closed in new record territory yesterday. 30 stocks inside the dow, that's interesting. i would have thought we would have if not all, certainly a majority. >> by the way, goldman is one of the best gainers there. goldman i think the biggest point contributor. other side of the satire, walmart. >> they started their free shippings yesterday for the whole week during prime week. >> stocks to watch. >> yes, they are. american airlines flying higher with the company says it
signed deals. it says it coulding in the pretack imcome in the neck three year. separately deutsche bank, and delta air lines to buy from hold, the firm says that head winds like brexit, and excess capacity have been priced into the shares of those airlines while improvements in unit revenue have net to be fully reflected. an international tribunal ruled against china in a territorial dispute. seema motty has horrid. has more. >> this came in as a big surprise. the international tribute rejecting china's territory claims, a critically -- china's foreign ministry quickly
responding, and expressing definance. philippines, vietnam and malaysia among others, we'll see if they use this ruling to assert stronger control, pushing china to potential amp up its defense. this could increase the risk of an accident in this heavy maritime -- but the united states has also been expanding its military pressure, one to exercise maritime freedom, and one -- the assistant secretary daniel russell telling me there's no up side to china engaging in a military confrontation. >> no good will come for anyone, let alone china, particularly as it struggles with a slowing economy from any kind of military clack. >> the coming weeks will prove
to be very important, meeting with john kerry, where it will likely dominate the discussion. >> joining us on the phone for more now on the situation is steven roach, former morgan stanley asia chairman. thank you so much for joining us. >> hi, steve. >> hey, bill. hi, kelly. >> frankly there had been some pretty harsh rhetoric from a former china eats toll politician, so what do you think the country does now? >> first of all, in contrast to what seema just said, i don't think this is a big surprise, and to get to your question, what does china do? i think you have to -- i think recognize that china's belligerence, which is very clear in the eyes of this tribunal ruling did not occur in a vacuum.
i think on importantly part of it can be traced to a very muscular china containment strategy that was launched by the u.s. in late 2011, when we unveiled the so-called asian pivot tipping or arsenal back to asia, along with a very ambitious trade plan later to be known as tpp that deliberately excluded china from. obama went further to say we can't let countries like china write the rules of the global economy. china didn't like that, you know? they have their own nationalistic aspirations, and they have responded illegally, according to this tribunal, but again the response is not something that occurred off nowhere. >> yeah. to this point, steve, the relationship between u.s. and china has, you know, it's been simmering. i'll use that word.
we've encouraged them to take steps on their courage sill, on human rights, all these things that have happened here, but they continue to simmer, they don't escalation. with china taking a hard-line stance, they don't feel like the court had any jurisdiction on that. they continue to maintain their control of that area. does it feel like it could get worse here than better? >> you're right to worry about it. i'm worried about it, too. our worries always seem to intensify. i've been doing this long enough to know they always intensify right before a presidential election. every four years it seems like we're coming to a real boy. we have an election and come back to a more temperate position, but this is the first time when the simmer has gone beyond the economic ballots and more of a geostrategic potential
military dimension. that's worrisome because of the potential for accidents, as you are alluding to. >> i wonder if you expect them to just ignore this ruling, stephen, or to respond to it as if they feel they have lost face or have to take a stand? >> i think they're going to put a lot of pressure probably behind the scenes on the united states and its allies to try to walk back from this level of hostility. they will not do it unilaterally. i think it would involve a loss of face with respect to their own perceived rules of a strong nation. >> steve, good to talk with you. be well. thanks for joining us. >> thank you, bill. thank you, kelly. stephen roach.
we have record territory today for the dow and the s&p. >> roger altman will tell us about what he thinks could pose the biggest threats to markets. after this run-up, that's just ahead. >> up next, yeah, poke mon go fever is spreading even here at the new york stock exchange. and everywhere, it seems. details how it's gaining popularity in china where it's not even rolled out yet. foand millions moremericans lwho feel its effects.s, let's walk together to make an even bigger impact and end alzheimer's for good. find your walk near you at alz.org/walk.
welcome back. with the market up 130 points in record territory, it's time for a cnbc news update with sharon epperson. >> here's what's happening. in dallas, president obama is paying tribute to the five slain police officers. he said despite the recent shootings, america is not as divided as it seems. >> dallas, i'm here to say we must reject such despair. i'm here to insist we must not be divided as we seem. i say that, because i know america. i know how far we have come against impossible odds. >> at least 22 people were killed and 43 injured when two italian commuter trains collided head on in the southern region
of, at least two people were pulled alive as the recent cube operation took place. a tanker crash and fire took place on a bridge over tampa. the truck was carrying 4,000 gallon of diesel fuel, and it had mechanical issues which caused it to crash. the brazilian health minister says the chance of being infected by the zika virus in rio is less than 1 in 500,000. he spoke at the launch of a new mobile phone app, which encouraging people to upload to the sism a description of how they're feeling each day. that's the cn. news update this hour. bill, back to you. >> thank you very much. >> going into the last hour of trading, record territory, a leading trader will tell us what he's watching as the dow makes its run to the highest close of the year in just a moment. >> which state is the top state for business?
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historic day. we have an eye at the dow on the fresh internet highs. what are you watching here? >> first of all, it's grate to be here. i told bill this move was imminent, and he was skeptical. >> live data, that came out last week was surprising you know, they're going to continue to get in behind this thing and support it, but know we see where the rubber meets 9 road. we start to see some follow-through in some of these big names. >> what about the -- >> banks. >> that's obviously the first one that comes up here. >> we have also seen oil.
>> interesting the way the transports are up today. this market could be one , and a lot of guys are excited about that. >> i saw it scribbling down there. >> thank you. bill? >> yeah, sorry we had to run there, gordon. heading to the close, 27 minutes left in the trading session, with the dow up on the heels of this week's report-shattering market moves, we will talk to roger altman about where he sees the market and the economy heading. we'll talk to a member of president bill clinton's administration, about the prospects of hillary clinton as well. stay tuned. ♪ you've wished upon it all year,
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he? was that bob pisani? so, yes -- >> you wonder why trading volume is light down here, by the way. every time we try to film a pokemon, somebody would get him. >> they were going after them with a vengeance. >> lots of green on the s&p today. any positive close for the s&p as you know, is a high for the day, and the dow now in record territory, up 135 points at the moment. >> >> speaking -- even in china, where it hasn't ruled out, julia boorstin has more. pokemon of her own. >> of course. >> that's right, kelly. people in china are so desperate to play pokemon go, with these crazy characters that they're playing chinese copycats of the game. you need a google account to play and you can't get one in china. here in the u.s., it's been
downloded more than 8 million sometimes, which estimates the game generates 1.6 million in daily revenue from the ios devices alone. this is up 55% in tokyo trading over the last week adding 9.8 billion to the market cap. the nintendo is sharing that revenue with developer which spun off from google last year, as well as the pokemon company, in which nintendo owns a third. the app stores both take 30% of all revenue that comes in. the app based in outcry ownerly that they were users were told they were giving the game full access to their google account to see and modify nearly all. niantic says that was an error and they are in the process of fixing it. kelly and bill, back over to you. >> impressed you got them to
hang out. you've trained one. >> like a little bet. >> thank you, julia. stocks are rallying, but our next guest says the wild card here is whether the market will continue to have confidence in the ability of central banks to keep global growth going. >> let's bring in roger altman. roger, welcome back. >> welcome back, roger. >> the brexit shock has worn off and then some. can you believe the snap back? >> everybody is heartened by the snap back. i think it reflects four factors. one is that interest rates will be lower for longer. the second is that brexit isn't going to have any meaningful effect on the u.s. the third is that the u.s. economy continues to be steady, even if the 2% rate we've been seeing now for two or three years. and finally that other markets are flashing signs which are positive for equities. yields are down, oil prices are
up, and in this environment, those are positive. so it's -- it's probably not a big surprise that the market is rallies, although to hit a new high is a little surprising, but on balance, the outlook for equities over the medium term is good. >> to your point on the credibility of central banks globally and the market's confidence in them. with abe's victory over the weekend and the election there, that seemed to be a green light for him to introduce even more stimulus, maybe a big fiscal and monetary policy package there. how much do you expect? and how effective do you think that will be finally? >> well, i think you have to be skeptical about the japanese economic outlook. there's been a lot of monetary stimulus, a huge amount so far to relatively little effect. now, of course, the
counter-factual may be that the japanese economy would be a lot weaker without it, but it certainly hasn't had a particularly positive impact on growth, but the largest point is that since 2009, if you take the balance sheets of the u.s. fed, the ecb, and the japanese central bank, together they have increased by $8 trillion since 2009. so you look at that figure, which is an astronomical one, almost hard to -- hard to get your -- hard to grasp, and you say to yourself that the central banks, of course in the trillized world have been keeping the economies afloat. in turn you ask yourself, can that continue? how will those central banks ever unwind that -- >> and that's why they're so
related -- a related request question is that these bond yields are so low and the prices have gotten so high, everybody has gotten so out of whack, can it possibly end well? >> well, short and medium term, i think the outlook for equities is good. there's nowhere else to go there's a flood of capital, and equities look good in terms of historical returns and dividendees in an environment of interest rates this low, but kelly, your point is a good one. is a 1.5% ten-year treasury a sign of strength or a sign of weakness? over the long term, it's a sign of weakness. it signifies weak global growth and signifies geopolitical instability as well as a flight to safety. >> i always thought i was supposed to invest in stocks
when earnings were going up, but we've been in something of an earnings recession in this country. do i only invest in stocks because the yields look that good right now relative to bonds and anything else? >> no, historilly the returns on stocks have been good, compared to interest rates anywhere near will. i mean, if you just look at the span of history as warren buffett so often says. so it's not just a dividend yields, and, by the way, we could be coming out of that earnings recession. i'm just saying over the very long term, you have to be cautious about the role the central banks have played. and what the level of interest rates is saying long term. >> roger, good to see you. appreciate your thoughts today. >> thank you, guys. >> roger altman. >> for the last decades, it's --
each year for the best state, and each year the winner is the best-kept secret. scott cohn is here to offer the very last hint for us to now guess this year's winner. scott? >> such a feeling of power. it's awesome. we lynn joined by a very special guest. i think we have kind of outdone orselves this year, but who's going to help us introduce it. we've been giving us hints all day. one-stop shopping, the need for speed, original colonists, making ends meet and eight is enough. a lot of you have weighed in with interesting guesses, but we're not done keeping you guessing. from here, after we named the top state for business 2016, as you heard bill say, we've been
doing this for ten years, so we're going to go -- maybe we leave or stay here, we're going to unveil the state that has done the best over the past ten years. so you'll want to see that tomorrow, but the immediate business, we will unveil the top state for business, and you will be able to see where your state tacks up, and we always want to hear from you using the hashtag top states. >> is it all apples to apples? what we do is look at what the states are talking about, and if the states are saying more states are saying we have a great work force, that carries more wait. so the idea is well to hold the states to their own claims, so
that's changed to reflect the landscape, but the categories, to keep it apples to apples have always been the same. >> all right. i'm going to guess -- my guess is based more on where you were yesterday, but i think you're in california. >> wow, wishful thinking. homeland. >> yeah. >> has new jersey ever won? >> that doesn't look like new jersey. >> i was away a bit, granted, but my guess is kentucky because of that little fence last hour. >> all right. there you are. we've got just about 15 minutes left. the dow is 18,342.
we are in record territory. art cashing was just telling me the market on close orders tells me the balance to the -- not a whole lot, but joining us right kn know, you're keeping your eye on everything just as the market is right now. what do you make of our historic rally compared to the rest of the world here? >> the national of the rally has been predominantly cyclicals. we take that as a good sigh. if you think year to date the defensives have been outperforming. growth is sustained in the u.s., it's been steady,. >> that all sounds right. but then again they weren't
shaken too much. >> it's interesting. there's something going on. we know they ten to go a bit out of the whack. historically i would say this time, though, i would expect for this to continue. in terms of yields, the three-year note auction was very poor. the demand today very poor. so has the appetite for low yields, is it waning right now? >> what this comes down to is the phet doesn't operate, and i think there's more connectiveness with global rates and global monetary possible. at the not diverge as much as they try. it just speaks to the -- so i
think we could continue to see a rally. >> to see them move into something more cyclical, what does it mean for some of the best returns -- >> i agree. you see cyclicals continue to move higher if they will. >> so we had a strong labor market report. growth is running at about 2.7%. if it becomes exciting, i think cyclicals could continue to rally. >> do you see anything to buy there? anything bargains? >> i think in europe brexit hasn't had too much of an impact.
i think as it unfolds. the time line about how brexit may or may not play out, you see pops of volatility, but right now broadly the market looks cheap, but we think there's a lot of uncertainly there. >> same thing for japanese stocks, people are wondering, is it now the time to chase? giving the renewed victor? >> for japan, everyone is waiting for more stimulus, whether we think that's enough to sustain a rally or make the market pop, i'm not sure. the value of the yen has appreciated a lot. we will take a break, come back with the dow up 116 points. we're hitting a record close there. it looks like we'll have one for the s&p as well. and a whole lot more on tap for the next hour of the program. we're also watching amazon stock today. it's been an all all-time high,
that's -- >> the last two days, this rally really goes back to, as we pointed out the japanese elections over the weekend. that sparked that 4% rally in the nikkei on monday that continued into our market. monday the s&p hit all-time highs, and today with any positive close is another new all-time high. here we are up another 15 points. the dow yesterday was on its way, wasn't at an all-time high, but what -- long-term yields, the ten-year, we highlighted how the three-year yesterday was weak at the low yields not very strong. the same happened today for the ten-year note.
the yield was 1.51%, so we have come back quite a bit in the last week. >> below 1.4, now 1.51? that's quite a move here. i want to emphasis while the s&p and dow are at new highs, the s&p small came up is essentially at a new high. let's not quibble about a point or two. the point is this is a brought rally, not just a bunch of the top 125 stocks. >> volume is not bad today, either. >> probably to 4 billion shares with the consolidated tape. on a normal summer day, 3.2 bill chron. you start getting towards 4 billion, i call that heavy volume. new highs, volume up, the technicians will love this.
you'll hear a lot of technical articles written tonight. >> oil has been very volatile. yesterday was down sharply. today we're coming back here. all kinds of cross-winds about the demand, the amount of production that we'll see for next year, the eia out with estimates for that as well. >> opec was talking about that this morning, better demand, next year production will be more in line with demand overall. so that helped oil. you have gold down, oil up, the dollar behaving. you have the ten-year yield up just a bit, but not enough to cause any panic, and you have two major indices at new highs for stocks. that is about as god -- goldilocks-y as you're going to get. now i think we have to get over what the banks will have to say. jim morgan will be the first.
>> thank you, bob. see you later. a record-closing high for the dow and s&p. we have a bunch of economists in the house today. and denny's, if you couldn't tell, is ringing it any nasdaq. stay tuned for how number two of a very special guest on the panel today. see you tomorrow, kell. another day of record high closes here on wall street. a look at the dow jones industrial average, which now looks to be going out at a fresh record high. 18,346 is the level there. that tops the previous high from may of 2015 by about 30 points. so again, a gain of 119 points for the dow. the s&p now sitting i believe its second straight day of a new high at 2152.
it added 15 points or nearly 0.75, and nasdaq for its part closing above 5,000, going into the black or green, however you would want to call it for the year. it opened the year at about 5,007, and closed with a gain of 34 points. now, coming up, we will reveal 2016's top state for business. by sure too stick around for the winner and a special music at guest. joining today we have mike santolli. >> and guy adami. are you allowed here? irs you and mike together unbelievable. i mean that, from 3:00 to 4:00, you guys are doing a great job. it's a special honor. we're going to see what happens this whole hour.
you also with you, mike -- >> is guy the special musical guest? i'm just saying. >> later in the hour, b.k. >> i don't see it being a buying panic or -- that being said, it's a bit extended. credit marx are very, very chronic. finally treasure yields lifting, plus chatter about bailouts, so a lot went right. i think 2150 is an interesting level, if only because it's the consensus yearend talent. >> we can close up shot, right? >> i hope i'm not here -- >> you secretly do hope. >> no, listen, without question, i've been a skeptic for a long
time now. i say it all the time. i would want the market to be built on a stronger foundation. i've also said, you know, i understand what's going on in terms of the really 100%. bev huge earnings this week. i think they absolutely do matter. and you have to ask yourself, is this the only game in town? >> we'll get to more of that in a bit. >> bob, how did -- >> and the important thing is the two biggest insises are at new highs right now, but it's even broader than that. let's look. dow industrials, your key here, that's what we needed. we did that rather handededly. i want to emphasize how broad the rally has been, because we're essentially at highs on the s&p mid cap and s&p small cap. let's not quibble about a point or two here. this is a broad rally, with small, mid and large caps all
participating in it. it was about as perfect a day as you could ask for. take a look at the major indices. the dow historic highs, crude was up rather dramatically, gold was down and the dollar behaved and the ten-year yield moved up a bit. this is about as perfect as you good et for a stock scenario. number of stocks hit new highs, maybe not as much as people expect, but a lot of people are just below highs. but here's what we call the fade trade. and gold all down today here a lot of peopling about whether the defensive names have much left in them. they have all been market leaders, at&t to the down side. i guess a key point is we've got gold down, we've got crude up, we've got the dollar behaving, the ten-year up just a bit. about as perfect a day as you could ask for.
guys, back to you. >> erasing the losses for the year, bertha coombs has more on the rally. we're about 200 points away from an all-time high, about 4% for the nasdaq, but bob was talking about the small caps. if you look at the s&p small cap 600, these are sort of the biggers small caps. they've had the best gains year to day. this is really what is working. they're not just as new highs, but you're seeing these stocks actually providing the leadership now. a look at some of the other sector highs, the etf highs we saw. mid caps, small caps, those are the biggest gainer, but today some of the biggest volume was in that mid cap etf, also when it came to a big cap tech. chip stocks as well. chip etfs are at a new high. some of the tech highs, we're seeing a bit of a rotation.
cisco today joins the club, not an all-time high. it will take a while, however, 52-week high for the year, just shy of $30 today, other bick-tech names, include intuit, game stocks are all riding that pokemon wave it seems. amazon today had illustrate a fresh all-time high. last year if you bought on prime day, you would be up about 15%. afterwards today we saw a bit of a swoon at the end. bertha, thank you, i was looking at some of the specials for amazon's prime day, they special have a weird and seiny section, but you can get cat purr therapy, motion-activated toilet night light. amazon shares are lower today. that's a side issue. you know, it's an interesting question.
frankly you have to be equally, if not more so, in -- look at corporate bonds, everybody is piling in there, aid missing out on exactly what's happening. >> it's all part of the same spectrum. they're not unrelated. they're all on the spectrum of things you can't buy, so that's one explanation. i also fall back on the idea that a market that has refused to go above a certain level for 14 months and really has stayed in a particular range for a year and a half, it's not a fluke, there's something going on. it doesn't mean it goes up for long or forever, but i think something is going on, earnings perhaps could be the cover satire for the next go higher. >> brian, where do you say? whether it's the earnings, maybe
a turn in the economy more largely? >> guy hit on it earlier. to me it's the story in japan, they are now talking about death-fueled stimulus, fiscal stimulus, if that narrative has changed, earnings may not actually matter, but if japan is going to do fiscal stimulus, you know what? make the u.s. after the election will do fills causing stimulus, there's a reason to do stocks. i think there's much better places. i would buy currency stocks. to me that looks like the absolute best trade out there. >> they have to go part and parcel, though. sure we did a done of qe after of financial crisis, but we also have earnings go up dramatica y dramatically, then they both stopped at the same time. just because people in japan or even the uk or brfr were saying
the central banks -- you do ultimately need earnings and factors. >> i thought that for quite some time. i thought for a while. said it for almost a year and a half, the chasm between earnings and revenue growth continues to widen out, but the market doesn't seem to care. we talk about gap earnings, generally accepted accounting principles, except the people who don't accept them is this market here. the gap between the 18 times, and the 1234, times gaap earnings, that's a big scary. as bill parcells said, you are what your record says. we're at a record high. as much as i would like to douse it with water, you can't the truth is here we are. >> would you be more comfortable. you've had a great call on bond yields, but would you in a weird way feel more comfortable if that was because the fundamentals weren't that great, as opposed to thinking that they
are okay? >> it's interesting, you know, i thought the move in the bond market almost mandated the stock market would correct to the down side. exactly the opposite has happened. one has to asks yourself if yields start to go higher, for whatever the reason, what does that mean for the stock market? in essence, nothing has hindered the move to the up side. every piece of bad news where i thought this was it, the market shrugs it off. maybe in a weird way the bond market going down, yields going higher will be the next positive catalyst. >> exactly. mike? >> at least for markets that are bigger than the yield-sensitive ones, right? consumer staples, the guys that have been bearing the load here are about 17% of the market. the rest of the market is 83%, financials are 16%, so it's actually kind of easier for the market to go up if in fact it's not all a yield story. what are the limits to that?
are the limits where we get to a point where we have to get refocused on wanting to have an -- i think we've had this very kind of special phase where you have 4% nominal growth, and the fed proceed to be shrined and kind of game on. does anything interrupt that? >> it also seems to be a case the credit cycle is dead. one of the best past performers has been consumer finance. my favorite nugget, we are officially subpresuming mobile phones. verizon does this offering about 1.2 billion, aaa-rated, and again it's going in, and the demand for this is way more than anticipated. the spread between what they're getting on this and so-called safe government debt is very low. the credit cycle lives on. >> mike wrote about this stuff seven or eight years ago, almost
that it's happening again. is it scary? to me it's scary, but does it scare the market? clearly not. >> we're able to point to one asset-backed deal. and insurance companies in germany are buying fake triple a dead, so obviously totally different, but the logic back then was, well, you're always going to pay your mortgage, you might let your other bills go. are you always going to pay the phone bills? >> you have to pay netflix. a parting word, brian. >> if you're buying the market now, you have to know you're buying into a bubble. simple as that. >> let's send it over to seema mody here. >> a strong day for health care is the company raising the-second guidian, and adjusted earning in the range of 1.19 to
1.22. the previous guidance range was 1.16 to 1.20, so beating its own photograph. testi teva is waiting for approval for the pending acquisition. >> you know what's interesting about the boy space, traded up to the 285 level. we talked about it forever on your show. double bottoms at 240. if you look at see what happened, that's exactly it. what's interesting now is none of the politicians have talked about biotechs for the last month, month and a half. it seems like the air cover for these guys is there. i actually think biotech is under-appreciated. i think you could have a stealth rally, not unlike we saw with oil. >> though i'm. >> their success seems to breed its own failure. >> you can get to brian kelly
next hour. they're talking to rich ross about the three stocks he thinks could take the dow to the big. up next two stock pickers who say there are great buying opportunities out there. their picks after the break. plus could the rally spur more startups to go public? we'll talk to someone with a pulse on the ipo market, later on "closing bell." you're watching cnbc, first in business worldwide.
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that area, harris, a orbit al. >> i think it's likely that oil prices will stay higher than the people might have thought otherwise in the summer, and we're looking at some of the stuff in the aerospace industry. >> what about you, chris? >> we have seen some is surprises out there already. so we see better hard wear which would been weak. we think the cloud builders are still spending, which is a builder of those servers should be doing pretty well. we also like a company gilyard, that's really historic. they're great at integrating new m & a, so we're still positive.
>> mike? >> i wonder in terms of the mid cap defense companies, you say that a relative valuation thing. is it a call on the election? on the next administration? on general defense spending trends? >> i think it's a call on general defense spending trends. you get pretty high multiples out there. and sometimes the mid cap guys are still trading. we think that's reasonable given where the market is going, which is today obviously went higher. >> super micro, their lastsh but value ways looks interesting. what's this car, not unlike what we see? where he do think there's holdback. so now here we are in the second quarter, and you're at points where these guys do need to
build out. the data doesn't stop, and you have to build and store. we're looking at the up i'm the here. >> and a start reminder, by the way that there's always a story. >> it's true that we think about these things in broad terms, but not to say you can't have an incredible overnight. >> looking for similar opportunities. >> you saw what happened with the nintendo stock. >> net urz. >> it's not like people are not looking at their phones enough, anyway, so. >> where are they finding these names? >> consumer finance sector,
airlines, all of these -- really got beaten down. is something scary have now bounced? >> one name we like would be air lease. it's an air leasing company, internationally exposed. it's trading right at book value. the shy there is what's the residual value of a plane seven, eight years out. they keep placing plane internationally. and at one time and potentially a credit rating upgrade the next couple quarters, we think it's probably good value. >> the final point i would love to hear you weigh in on, are you having more trouble finding value than you might have when it was cheaper in does is it feel like, no, there's present of good names for us to pick? >> i think it's harder to find that you can stand behind, but i
think the market right now are all pricing anticipatory, and that's where you're seeing the convulsive moves up. you can't be short anything, that means there's things out there that were looking like they were starting to become attractive, so for me that's trickier. i have a value bias, so we look for dividends, so we're looking for dividend yield and evaluation that we can live with. >> we do think there's values and still names, but the key is you better be with a good management team, otherwise it's a valuable trap. they really can stay down there, but we do see some. it's been more difficult, two, three weeks ago, around brexit, there was opportunity. >> for a day or two. >> chris, sarah, thank you both for joining us this afternoon. we appreciate. a record day for they markets, s&p 500 closing in uncharted territory. we'll ask you whether that could prompt more territories to
become -- me amazon is having is second prime day. there is some concern about the strength every today's sales. we'll have more when we come back. hi daddy! gain the freedom to fumble with the new water and shatter-resistant samsung galaxy s7 active. buy one now and get the samsung gear s2 for free. exclusively at at&t. would
the second annual prime day. it featured some good deals and some problems. courtney reagan has more. >> he, kelly. there's still more than seven hours to go, though last year's prime day fail hashtag still got some use when there were issues adding some its temperatures to carts, though it says, priceblink says when looking at some of amazon's top feature deals on products that are also available at other retailers, nearly all of them are lower by an average of 30%. the bose soundsport 48% off the normal price, and again lower than other retailers, or a pressure cooker, 22% lower than the next lowers competitor's price. deals are only available for
prime members now, prime members are moe valuable, spending about $1200 annually. so amazon's main goal is to get more consumers to sign up, even if it's initially just for the -- beyond retain they're still well below black friday. they estimate last year's prime day generated 375 to 400 million in sales. this year he expect it could double. piper jaffray is still confident that it would deliver 30% more unit growth over last year. kelly? >> courtney, thank you. question to you guys. this isn't black friday. amazon has created its own holiday.
walmart shares higher today. >> eithery moving, i think people generally treat it as a broader phenomenon than just let me find specific deals on amazon. >> kelly, i will say that actually walmart is see a nice bump up. hook logic, another outside source that we've been talking to saying, look, conversion is up. they monitor about 45 din retailers, but it seems to be help retail, maybe they're going to a web side, so actually it may be helping more than hurting. sorry, guy, i didn't mean to jump in there. >> walmart's had a stealth rally all year. i still think valuation is
pretty reasonable. much quarter had an amazing year, and earlier this year, you saw a 2014-like quarter that scared everybody. obviously february didn't help. one has to wonder, is next more like 14? clearly the guys in the bull camp think more 2015. glue today president obama hailed the officers' service at the protest against police violen violence. >> our entire way of life in
america depends on the rule of wall, in this country we don't have soldiers in the streets or militias setting the rules. instead we have public squares police officers like the men who were taken away from us. >> intense fighting between the syrian got and aleppo has completely cut off the only rod for address. footage released by the sir yang government shows the desserted rode with plumes of smoke rising. treasury secretary jack lew is saying flex ability is the key to navigating brexit. he said britain and the eu both should show flexibility in negotiations. the soccer roster has been named. it's attempting to become the first women's soccer team to win
the world cup and olympic titles in back-to-back year. it includes 10 of the 11 players from last year's world club squad, including karli lloyd and hope solo. hope they do it again. >> the 16-year-old from new jersey who made it in the 400 hurdles, oh, my gosh, wow, and she was a juggler? youngest person on the team. going to be watching for that. >> take care. >> you too. the ipo marked is showing signs. wee ask next. plus just minutes away. scold cone joins us live for one last hint ahead of the big reveal.
for its pardon, 15 points higher, and nasdaq now in the black for the year after a 34-point gain putting it at 0,022. does in all signaled a green light going forward? joins us is -- making a trip down to the stock exchange, we preserve that. >> thanks for having me. >> the pipeline dried up almost totally for a while. >> the ipo pipeline was really nonexistent. >> we talk about this money domiciled oversees, 4 trillion
or so that could be repatriated, but in an interest way, it allows some of the things to be works on. can you speak to that? >> we're quite unine. if it does, it has a corp partner. the trick is we're investing in something with marked value, but in some ways drives strategic value. if you can do that, you're insulated to the market. >> so we're launching a starredup? china right now. it's in the fetal monitoring business, so you have 20 million more babies -- not coming online, but coming out over the next couple years, so that's a big market. this is going after the fetal monitoring for moms to see how their babies are doing. in that space the investment
partner there is al llianz. their -- it flips from i'm having a baby to i have to protect the baby. therein lies the insurance products tore sold on the platform i'm god.corporate priorities, so it's kind of an outsource are of the r&d function left? >> i think it's helping them -- it's about creating the ecosystem. we're quite large, 400 people, we're global, we -- we have to go, but real quick. we've sees hostess go public again. we have also seen plenty of people exiting by just.acquired.
>> i think it would be a bala e balance. >> thanks for joining us. >> jeff shumacher, thank you. scott cohn is in the winds for us. >> this is or tenth year, as you said, and it's done something that no state has ever done in the ten-year history, and you're about to find out what it is, what state it is, and we're going to introduce it in a way we have never done before. stay tuned, "closing bell" continues in a moment. i enjoy keeping people up at night. my analysis shows your stories are actually about human connection, even love. great storytelling needs drama and empathy.
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inspect i did my very best ♪ ♪ now as the season pass ♪ i try to make it last ♪ and i watched it fall away ♪ but a man can be measured by the number of times he's knocked down ♪ ♪ it's all about what he does when he gets back up again ♪ ♪ i'm a survivor ♪ what are you gonna change your mind for ♪ ♪ you're the one i die for ♪ take me as i am ♪ don't just ignore me ♪ no need to feel sorry for me ♪ i don't need your pity ♪ treat me like a man ♪ i'm not a shadow of who i used to be ♪ ♪ it's just me
♪ i have been fighting for so long ♪ ♪ whether it is been right or wrong ♪ ♪ it's become a way of life ♪ and now after all that the tears ♪ ♪ standing strong through the years ♪ ♪ what have i become ♪ i'm a survivor ♪ what are you gonna change your mind for ♪ ♪ you're the one i'd die for ♪ take me as i am ♪ i'm a survivor ♪ what you gonna change your mind for ♪ ♪ you're the one -- take me as i am ♪ ♪ i'm not a shadow of who i used to be it's just me ♪
let's look at utah's climb to the top. we searched far and wide for the state that puts it all together for business. this year that station is west. utah the beehive state buses to the top. the state soars on the strength of its economy, a priority for the governor. >> together we said a got to not recover, but to become the top performing -- >> utah consult in number threw, but that's just the start. utah is the first state since our study began to fin in the top half of each of our ton ten categorie categories. utah's individual and corporate taxes a flat 5%, state and local
sales taxes top out at 8.35%. unemployment in utah is well below the national average, with some of the strongest job growth in the nation, but the challenger for governor says the statistics don't tell the story. >> we don't have enough high-playing jobs to pay a living wage. intermountain is the largest employer, the largest industry is finance. this is utah's eighth appearance in the top five, the befinish yet. the one-word motto -- industry, a if perfect fit for the stop state of 2016. >> yesterday we were at park city. our thanks to all the people up there. one-stop shopping, well, the first department store was founded in salt lake city. founded by brigham young in 1868. need for speed, of course the bonneville salt flats.
original colonist, this is the beehive state. making ends meeting, this is the site of the golden spike where they broad the transcount nevin railroading to, and eight is numb. eight osmond brothers plus marie. a lot of great guesses, gary herbert is the 17th governor. he joins us from the state capitol in salt lake city. governor, i've been following your state for the ten years formed you've never been a state to rest on yours laurels, so what is left to do? >> we can still build. we're not perfect. we're striving for perfection, but this is a great hon ore. thank you for recognizing utah, and i agree 100%. no state is perfect. i want to ask you about a
controversy that's been raging that has an inns la rely station and that's the issue of the state giving a loan to one company to gift port fa what can you tell tuns that you're not to get a fair shake here? >> well, again there's a misrepresentation in what's happening in oakland to have us access a port to sell leaf products. in exporting of coal. that's a different issue. the environment in utah, was very business friendly. we kept faith with the fundamentals that have made america great in the past. we have competitive tax rates. making sure are -- for the wealth creator, and consequently
a business is thriving out here and diversifying. those are the things that people are finding in utah. that's why we're growing businesses with inside our state and colocating in our state to expand their profitability and market share. >> governor, what is left to do? what are the weak spots? in the past education has come up short. that did well how do you stain that? and what do you do to keep this going now? certainly education is one we need to continue to keep the pedal to the metal. the fact of the matter is we have a large growing student population. we have a higher birthrate, larger family sizes, so we have some uniqueness there, but we are trying to become the best education system in america. we're not that star off without
being out of the top ten. we'll make even better strides as we look at education as k through 16 and beyond in a very seamless approach. we want to have the labor force of tomorrow here in utah today, and we're working our way towards that very end. >> very good, governor. again, congratulations. >> you can see where your state stacks up right now. topstate.cnbc.com, the whole study is now online. we'll go from here to the state that's done the best of the past ten years. that's all day tomorrow. we're not done yet. once more from america's top state for business, the album is the soundtrack of my life, again donny osmond. ♪ i'm a survive ♪ what you gonna change your mind for ♪ ♪ you're the one i die for ♪ take me as i am if this is live i don't want
to interrupt. oh, man, i'm going to be -- what do you think? you nailed it. if they had him rig the methodology. >> donny osmond is rocking. >> it says live, but i don't know if it is live. it is live. we need to stop. >> now, he's done. >> man, our apologies to donny osmond. we were trans fixed watching that all go godown. i can't get over the original colinist clue. the behive state, come on. >> beyond the clues, the access to capital. by the way, like goldman sachs has put more people in utah. >> biggest industry is finance. >> take a look, quick stock. look at what sky west has done over the last couple of months
when other airlines are going where, they've made a 52-week. doubled over the last six months. >> >> headquarters in salt lake. less than a week away from the republican national convention. delegates are starting to descend upon cleveland. corporate cash is staying on the sidelines though. that's next. can a toothpaste do everything well? this clean was like - pow. it felt like i had just gone to the dentist. my teeth are glowing. they are so white. 6x cleaning*, 6x whiteningá in the certain spots that i get very sensitive...
now saying the fda has removed the hold and are going taback t the original treatment plan. so you're seeing the stock up more than 20% in the afterhours. >> wow. that was fast. thank you, meg. now, the republican national convention is kicking off in cleveland, ohio in six days. platform meetings are underway. traditionally, major corporations make major contributions in the convention, but this year is turning out differently. >> this has been a radio active political year. maybe too radio active for some big american corporations. you know how corporate pr offices are. all of these companies have different explanations for why it is they are not here. those explanations in some cases, too detailed, but the bear fact is that a lot of companies that paid big money to sponsor conventions are not doing it this time around. take a look at this list and you'll see who i'm talking about. general electric paying $100,000
in 2012. nothing in 2016 to the rnc or dnc. $250,000 last time. nothing this time. jpmorgan chase, a charlene picture. they say instead writing checks to local charities in the cities where the conventions will be held. ford solutions and ups all writing checks of more than $100,000 each time. this time, zeros across the board. it may just be this political season is something these companies don't want to be associated with and obviously here in cleveland, there's a lot of talk about just how radio active their presumptive no, ma'am nominee is. obviously, he was the clear victor coming out of the primaries, so not all the focus is going to be who will he pick as his vice presidential nominee. we suspect that news to be coming later this week. >> maybe the vp will unleash more capital. thanks. >> anything's possible.
>> yeah. markets touching new highs today. but will that momentum continue into tomorrow? we'll ask, next. tomorrow on "squawk on the street," don't miss a first on cnbc interview with general mills ceo, ken powell. he's getting set to host the company's investor day. tomorrow at 9:30 a.m. [announcer] is it a force of nature? or a sales event? the summer of audi sales event is here. get up to a $5,000 bonus on select audi models. you can fly across welcome town in minutes16, or across the globe in under an hour. whole communities are living on mars and solar satellites
welcome back. haven't gotten a solo from guy. >> it's an art cashin came up to me, when adam comes up and says hi, what a gentleman. you're fantastic. >> the quintessential, sets a tone for everybody else down here. >> efb should be as cool as art. i appreciate that. thanks for having me. my "fast money" fans are all mad at me, the guys on the desk are mad at me. >> there's plenty of guy to go around. don't waste your final seconds. >> as much i would like to be a naysayer, the price is is truth, folk, and the market want to go higher. if you want to look at one name tomorrow, the overreaction in kite pharma on back of juno last week, that stock the probably trading higher. >> mike. >> looking for the ten-year
yields. they might come up in some friction here about 1.5, but that's giving you the idea. >> i'm looking forward to the banker. >> market's still overbought. 7.5% in ten days. >> everything's fine. thank you, both. that does it for close bell. "fast money" begins now. ♪ breaking news. hallelujah, that is what investors across america were singing today as the dow set a new record and the s&p set a new record high today. this is "fast money," america's post market show. i'm melissa lee. tonight's lineup is -- tonight, the goal is really simple. to help you navigate these xup rant, but confusing market and to do that, we are going to start with with a simple question. with the dow and s&p a new record, is the nasdaq next? pete? >> yes. i think it is. i mean, i don't know it wouldn't. because the rotation that we're seeing now isn't necessarily out. i mean, i know everybody's been really pinpointing and saying yoow